A proponent of the “sovereign citizens”
movement and self-proclaimed president of the “Republic
for the United States of America” has been convicted of
conspiracy to defraud the United States through a series
of seminars in which attendees were taught to pay their
federal income taxes by filing fictitious bonds (Turner, No.
1:12cr169-MHT (M.D. Ala. 3/25/13)).

Followers of
the sovereign citizens movement maintain that individuals
can decide which laws to obey. One tactic they practice
involves engaging in protracted legal battles in which the
individual files numerous court filings espousing various
legal theories couched in a coded “truth language” that
requires a lexicon to decipher.

The defendant,
James Timothy Turner, is president of what is reportedly
the largest sovereign citizens group, the Republic for the
United States of America. In September 2012, he was
indicted by a federal grand jury on 10 counts, including a
charge of conspiracy to defraud the United States.

The government demonstrated that Turner and his
co-conspirator, Billy Ray Hall, put on a series of
seminars around the country in which they taught attendees
how to file fictitious bonds and other fictitious
financial instruments as a way to pay their taxes and
other debts. According to the government, the charge to
attend these seminars was $150 and one pre-1964 silver
dollar. The district court held that the filing of the
fictitious bonds was done to defraud the United
States.

The indictment said that Turner also caused
“false, fictitious, and fraudulent financial instruments”
to be filed with the IRS, Treasury, and other government
entities. In 2008, according to the indictment, Turner
filed a fictitious bond in the amount of $300 million in
purported payment of taxes and other debts. The indictment
also said that he helped co-conspirators file fictitious
$100 billion bonds with the IRS.

Turner’s
indictment also charged him with violating Sec. 7212(a) by
falsely reporting payments to the IRS on various tax forms
and with failure to file a tax return in 2009.

After a trial, a jury found Turner guilty of:

Conspiracy to defraud the United States;

Attempting to pass a false or fictitious instrument;

Aiding and abetting an attempt to pass a
false or fictitious instrument;

Corruptly
endeavoring to obstruct or impede the due administration
of the internal revenue laws;

Failing to
file a tax return; and

False testimony
under oath in a bankruptcy proceeding.

Sentencing is set to take place on July 29. According
to the Justice Department, Turner faces up to 164 years in
prison and a potential fine of up to $2,350,000.

The winner of The Tax Adviser’s 2014 Best Article Award is James M. Greenwell, CPA, MST, a senior tax specialist–partnerships with Phillips 66 in Bartlesville, Okla., for his article, “Partnership Capital Account Revaluations: An In-Depth Look at Sec. 704(c) Allocations.”

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